This review explores the evolving landscape of G‐protein‐coupled receptor (GPCR)‐based genetically encoded fluorescent indicators (GEFIs), with a focus on their development, structural components, engineering strategies, and applications. We highlight the unique features of this indicator class, emphasizing the importance of both the sensing domain (GPCR structure and activation mechanism) and the reporting domain (circularly permuted fluorescent protein (cpFP) structure and fluorescence modulation). Further, we discuss indicator engineering approaches, including the selection of suitable cpFPs and expression systems. Additionally, we showcase the diversity and flexibility of their application by presenting a summary of studies where such indicators were used. Along with all the advantages, we also focus on the current limitations as well as common misconceptions that arise when using these indicators. Finally, we discuss future directions in indicator engineering, including strategies for screening with increased throughput, optimization of the ligand‐binding properties, structural insights, and spectral diversity.